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Under Section 24A of the General Clauses Act, 1897, the Judicial Bodies are required to give Reasoned Decisions --- Lahore High Court, Lahore

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Under Section 24A of the General Clauses Act, 1897, the Judicial Bodies are required to give Reasoned Decisions --- Lahore High Court, Lahore

Islamabad 12-10-2024: The Lahore High Court has set aside an order passed by the Appellate Tribunal Inland Revenue due to its failure to provide a reasoned and speaking judgment, as required under law. The case involved an income tax reference filed by M/s Medequips against the Commissioner of Inland Revenue, where the applicant argued that the Tribunal dismissed their appeal without addressing key legal and factual issues.

The judgment, delivered by Mr. Justice Abid Aziz Sheikh and Mr. Justice Sultan Tanvir Ahmad, emphasized that judicial and quasi-judicial bodies are mandated to deliver reasoned decisions. The Lahore High Court highlighted that providing a speaking order is essential for enabling higher Courts to properly assess legal controversies, in line with Section 24A of the General Clauses Act, 1897.

The Tribunal had rejected the taxpayer’s appeal without any detailed reasoning, stating that no legal or factual infirmity was found in the previous orders. However, the Lahore High Court found this approach insufficient and highlighted that such an omission makes it difficult for aggrieved parties to pursue appeals effectively.

The Court cited multiple precedents to reinforce its position, including Muhammad Iqbal Chaudhary Vs. Secretary, Ministry of Industries (PLD 2004 SC 413) and Muhammad Amin Muhammad Bashir Ltd Vs. Government of Pakistan (2015 SCMR 630). These rulings affirm that statutory authorities are required to provide reasons when exercising their powers.

Furthermore, the Lahore High Court dismissed the Commissioner of Inland Revenue’s argument that the question raised by the applicant was not arising from the Tribunal’s order. It referred to the Messrs F.M.Y. Industries Ltd Vs. Deputy Commissioner Income Tax (2014 SCMR 907) case, which states that legal questions may include those raised but not addressed by the Tribunal.

The Court remanded the case to the Appellate Tribunal Inland Revenue with directions to pass a fresh decision based on detailed reasoning. The Tribunal has been instructed to hear the case on October 14, 2024, and conclude it within two months.

This judgment reiterates the importance of transparent judicial processes and ensures that all decisions must be backed by clear legal reasoning, upholding the principles of fairness and justice in tax adjudications.